Moving Into A New Distribution Center

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Published February 23, 2017

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Orchestrating a move to a new Distribution Center (DC)? Follow these basic and essential steps to insure success for you and your provider.

When moving your goods from an existing DC to a new DC, whether or not it’s internal or involves a 3PL, there are some essential steps to take to help insure a smooth process. There are many issues to consider and monitor closely. No relocation is as simple as it first appears.

Leadership alignment: This trumps all other concerns. If the senior leadership of both companies aren’t aligned then the barriers become higher and the issues more difficult to conquer. Understanding the other’s goals and priorities along with limits is vital to a successful operation. Nothing overcomes this more than face to face meetings to establish joint goals and directives. A steering committee made of senior decision makers is extremely important.  The committee should meet regularly to monitor the progress and to help clear obstacles in the most expedited manner possible. Providing additional resources to specific issues is easy with the proper steering committee.

IT issues: Not to be taken lightly, IT issues are generally the first item people think to address. You need to outline all the steps to be taken, which documents do we need to exchange and is there a history of success between the ERP and WMS systems? Most companies don’t have the internal depth of bench to handle these issues and the configuration changes and mapping required. Outside contractors can usually provide individuals with a successful history of performing these tasks. Proper selection and testing of all systems and documents are an absolute must. The very success of the venture and the brand’s continuing business depends on it.

Human resources: These are vital to transitioning and establishing product flow out the door as quickly as possible. From senior management to floor supervisors, operators experienced with your product type are essential to understanding the daily business requirements. Generally dictated in the Request for Proposal (RFP) process as a requirement, experienced individuals strategically located in the distribution operation will drive success through an in-depth knowledge base that can’t be duplicated with hard work or by throwing people at the problem. Shippers typically use the “ants on a twinkie” mentality (throwing more labor on the issue), when faced with productivity issues when experienced operators are more likely the key to maintaining individual Key Performance Indicators (KPI).

A proper transition plan: The adage of “plan to succeed and succeed because you plan” is never truer than when applied here. If you can accurately identify and track the multiple functions and tasks you can sort issues prior to them being an obstruction to success. If your company hasn’t gone through this process before, the most expensive action you can take is to try it alone. Transition plans are common items for most consulting firms and should be shown up front as the guidebook for the project.

Dashboards: The late Peter Drucker is often credited with two famous sayings. The most famous of which is, “If you can’t measure it, you can’t improve it.” These are wise words from one of the most famous thinkers in our industry. The establishment of key indices early on and the development of a Dashboard of reporting are essential. When properly crafted to show a multitude of functions within the DC operations it not only reports units shipped daily, it becomes a tool for identifying problem areas and offers an opportunity for corrective behavior before an issue becomes severe.

Collaborative Efforts: As vital as every item on our list combined, the players on the ground at the granular level need to work closely together as a team. Collaboration at this level provides the ability to overcome all concerns that arise. Weaknesses need to be exposed and issues shouldn’t be hidden. Without active daily collaboration from the key operators from both sides, the project could be doomed for failure. These are not only the outside consultants or contractors employed for the transition but also the key players who have become business partners for the length of the agreement and possibly longer. They must quickly learn to respect each other’s opinions and to understand everyone’s place and needs with the new relationship. If this is a move to a 3PL environment then these individuals are now “married” in a very specific sense. They will be working together daily for their mutual success as companies and just as importantly as people. Most companies now employ experts to employ a change management program to help associates adapt and understand the new relationships and changing workplace dictums.

Any relocation of a distribution environment is stressful, on multiple levels. It brings a wealth of knowledge and opportunities for success by gathering new and powerful people together to effect a positive change for all those involved. Proper planning and having the right mentality about the process can go a long way towards a successful venture. Although it can seem daunting, with the right planning and experienced people guiding the process, it can also be a time of excitement with new horizons. Take the time to do it right because in most cases it’s going to be your home for the next five years or more.

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I understand that Tompkins will only use this information to contact me about business opportunities. By completing this form I am confirming that I have read and accept the Privacy Policy.